US job market shows more signs of slowing

New data indicates a slowing US job market with private payrolls rising less than expected and unemployment claims increasing.

By Ahmed Azzam | @3zzamous | 3 July 2024

Market close
  • Labor data Wednesday offered more signs that the labor market is slowing down

  • Private payrolls rise less than expected

The labor market in the United States continues to exhibit signs of deceleration. According to the ADP, private businesses added 150,000 jobs in June, a slight decrease from the revised 157,000 gain in May and below the anticipated 160,000 increase.

Unemployment Claims Increase

Continuing unemployment claims reached a two-and-a-half-year high, suggesting a softening labor market ahead of jobs report. The number of people claiming unemployment benefits rose by 4,000 to 238,000 in the last week of June, surpassing market expectations of 235,000. This figure remains close to the 10-month high of 243,000 recorded earlier in the month. Recurring claims for unemployment benefits increased for the ninth consecutive week, the longest stretch since 2018, indicating that more people are struggling to find new employment.

These two reports, released before the government’s June employment report on Friday, suggest a weakening demand for workers.

Federal Reserve Chair Jerome Powell said Tuesday during a panel at a European Central Bank conference that there’s been a “substantial” move toward balance in the labor market between the supply and demand for workers.

FOMC meeting minutes

The US equities market will close early today and remain closed on July 4th in observance of Independence Day. Investors are also awaiting tonight's Federal Open Market Committee meeting minutes.